New market information indicates that the Environmental Protection Agency’s war on energy waged through an onslaught of new rulemakings to limit emission of CO2 is going to be expensive for American households and businesses. Critics of the unilateral rulemaking efforts of the EPA have predicted that energy costs will increase due to new government regulation, while administration officials, environmentalists and other supporters of the new EPA rules have argued the costs will be minimal.
The market is starting to speak, and the news is not good. Peter Glaser, who has been tracking the EPA rulemaking in Washington and who testified to the Michigan Legislature earlier this year on this issue, reports that Louisville Gas & Electric has filed for a 19 percent rate increase by 2016 to pay for the upgrades required by the new EPA regulations. PJM Interconnection, a FERC approved regional transmission organization that serves 13 states and the District of Columbia, has had to pay in market auctions $2 billion to $3 billion just in capacity costs for a one year period (2014-2015). This was attributable to the new EPA regulations, and two and a half times more than analysts had predicted.
Any illusion that the EPA’s heavy-handed regulation of CO2 will not be costly to consumers is quickly being dispelled in the market place. An increase in energy costs could not come at a worse time for the American economy, with unemployment numbers being reported today that indicate the national unemployment rate is headed back up and now stands at 9.1 percent. Americans who have shivered through one of the coldest springs in recent history should be mindful of what the government’s ideological war against global warming is costing them in terms of less discretionary money to spend in their monthly budget and the loss of more U.S. jobs.